Over the last decade, the retail industry has undergone a dramatic change. Retail business management, small or large businesses are not willing to make significant investments in hardware systems.

Instead, retail businesses are adopting point-of-sale software. Therefore, the point of sale software development is considered to be at the core of retail operations.

The popularity of point of sale (POS) systems in the retail world are constantly replacing cash registers. Contrary to the traditional system, POS solutions optimize sales by collecting relevant customer and goods data and adjusting stock levels in real-time.

What Is A Point Of Sale (POS) System?

Simply put, a POS system is the time and place where retail transactions take place via face-to-face payments from customers. Being central to any retail transaction, it handles payments, processes customer purchases, and record sales. Therefore, having a good POS developer will benefit the retail business.

A good retail POS system will offer advanced functions like inventory, employee and customer management, track sales, reward employees, and correct pricing. Therefore, it is crucial to get the right software development company for getting a scalable POS system.

Types of POS systems

The POS system can range from a simple processor to a complex cloud system based on organizational needs. A choice can be made depending on the retail business size and whether it’s an online or physical store.

Broadly, POS systems can be classified into:



Mobile POS


Mobile point of sale or mPOS utilizes electronic devices like smartphones or tablets as terminals to attach credit card readers. Therefore, mobile POS is a portable and convenient option for most retail businesses. It also supports the attachment of peripheral devices like receipt printers and barcode scanners.

mPOS is suitable for small retail businesses or enterprises, small pop-up shops, retail stores, or quick-service restaurants.


Terminal POS


A terminal POS solution is essentially a hardware or software-based system. It includes add-on peripherals such as barcode scanners, receipt printers, credit card readers, and cash drawers. Popular features of this system are inventory management, CRM, payment receipts via email, reporting and analytics, and customer loyalty programs.

This solution is the best for retail establishments, namely restaurants, book stores, grocery stores, boutiques, salons, and electronics stores.

Terminal POS is popular in the aforementioned areas due to its reasonable prices and advanced functionality.


Cloud POS


Cloud POS is known as a web-based solution. It can be integrated with a retail business’s existing hardware like a tablet, computer, or printer as an online POS system.

This system encompasses all features of a terminal POS system. In the case of the terminal POS system, it is installed in servers. Whereas the cloud POS is installed in data centers curated by POS vendors.

This solution is applicable for all types of retail businesses, mainly startups because of their tangible benefits in terms of simplicity, cost, function, and flexibility.

Source: unlocklive.com

Components of a POS system

In a broader sense, the two main components of a POS system are software and hardware components.


The software component is either a cloud-based or an on-premise model.

  • Cloud-based or Saas is a system that can be accessed and supported via the Internet. This allows the system to track sales, sync, and store necessary retail data.
  • An on-premise system is more of a traditional software model. For its installation, businesses might have to purchase multiple licenses. In addition, it may become cumbersome for large retail businesses to manage and update the software system by themselves.


The hardware component remains the same regardless of the vast choices in the software component. It commonly consists of the barcode scanner, receipt printer, register, cash drawer, and credit card payment system.

Benefits of POS development

  • Provides an easy and sorted format of payment functionality.
  • Improved sales tracking helps to track information about tax, revenue, shipping, and quality.
  • Reduces chances of error, common in case of manual updates.
  • Lowers costs on inventory overheads.
  • Saves effort on salesforce and speeds out the checkout process.
  • Quick and easy automation of accounting tasks and report generation.
  • Profitable relationship with vendors due to timely reminder of inventory levels.
  • Direct marketing campaigns are processed by system-generated customer information.
  • Increases website traffic and customer satisfaction.

Source: softwareadvice.com

Reasons why POS software development is necessary

To create an effective POS system, several advanced features must be integrated into the POS software. Get detailed information about the best-reviewed POS systems on Top POS Systems.

Listed below are some of the major features of a POS software solution.




An advanced POS system must have an exemplary configuration for easy integration with other modules: inventory management, accounting, loyalty, gift cards, time, and attendance. In addition, a well-integrated POS system leaves less room for any error or discrepancy in data when transferred manually from one system to another.

Cloud integration


Often the on-premise point of sale solutions can come across as heavy and complicated. This is where cloud POS integration comes to the rescue. It easily customizes a simple POS system as per the likings of a particular retail business.

Inventory management


Every retail business experiences inventory shortage and some point of time. This issue can, however, be solved through on-site inventory quantity management. In addition, inventory management opens a window of opportunity to observe the stock levels closely at all times.

Employee management


This feature allows retail business owners to manage their employees. For example, a sound POS system helps to track employee clock-in and clock-out timings for shifts easily. Alongside, it allows employee scheduling and payroll management.

Streamlined purchases


Businesses, regardless of their size, find this feature a crucial aspect of their industry. It refers to the process in which a company obtains goods and services. This has a significant impact on the overall spending, profit margin, and success of a retail business.

Advanced billing system


A common feature to run any retail business is that POS software is necessary for the billing system. It offers hassle-free printing of bills and invoices.

Customer relationship management


Managing good relationships with customers is a crucial part of running any retail business. Customer relationship management or CRM is beneficial for maintaining the profiles of regular customers. The customer details may include their purchase history, date of addition to the system, personal details like email id, mobile number, and identity proof. It allows businesses to enhance customer experience personally without further complications.

Loyalty programs and discounts


Apart from CRM, the addition of customer loyalty programs also enhances the customer experience. For example, based on previous purchases from a particular retail store, the POS allows discounts and coupons for regular customers. This is how even potential customers can become frequent buyers of a particular retail store.

Source: connectpos.com

Accessibility to electronic devices


This POS functionality employing electronic devices offers remote access to retail store details. As a result, it helps to manage the business without being physically available at the store.

Sales reporting and analytics


Another efficient feature is the POS system’s capability to track the number of products and goods sold. In addition, it provides detailed reports on the amount of revenue made from each product by the retail business. Upon getting a grip of the bestselling and least-selling products, it’s easier to prioritize the available products’ money, time, and effort.

Security and reporting


This functionality of a POS solution works in compliance with Payment Card Industry Data Security Standard (PCI DSS). It serves to protect the integrity of sensitive and critical customer data.

Accurate reporting helps to maintain a stable connection with all departments within a retail business. This helps retailers keep track of the ongoing trends, where bottlenecks are occurring, or opportunities to grow. In addition, a comprehensive insight helps to review the inventory at the SKU-level sales view.

Wrapping up

With technological advances, a POS system will help retail businesses to promote their long-term growth.

First, figure out the estimated cost of POS software development by putting in enough time and research. For example, 2% to 3% of the expected cost may come from a retail business’ annual revenue. At the same time, 12% to 18% of the exact cost may be covered through yearly maintenance and upgrades.

The development of POS software comes with a price. When consulting with a software developer, remember to check if hidden costs include hardware, credit card, or customer service charges etc..

Therefore, choosing the right POS development company is essential based on the business needs, budgets, and system requirements.



Sarah Schumer works full-time as a Content Manager with a Outreacheo. She is also a freelance writer for multiple clients across multiple industries. She comes with several years of web content writing experience.

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